Vishay Intertechnology Adopts Stockholder Return Policy

•	Structured to enhance returns to stockholders and to invest in growth initiatives

•	Calls for an annual return to stockholders at least 70% of free cash flow

•	For 2022, Company expects to return at least $100 million to stockholders consisting of $58 million in dividend payments and at least $42 million in share repurchases

Malvern, PA – Vishay Intertechnology, Inc.  (NYSE: VSH), one of the world's largest manufacturers of discrete semiconductors and passive components, today announced that its Board of Directors has adopted a Stockholder Return Policy that will remain in effect until such time as the Board votes to amend or rescind the policy.

The Stockholder Return Policy calls for Vishay to return at least 70% of free cash flow, net of scheduled principal payments of long-term debt, on an annual basis. Vishay intends to return such amounts directly, in the form of dividends, or indirectly, in the form of stock repurchases. For 2022, Vishay expects to return at least $100 million to stockholders consisting of approximately $58 million through its existing quarterly dividend program and at least $42 million through share repurchases.

Commenting on the Stockholder Return Policy, Marc Zandman, Executive Chairman of the Board, said, “The Stockholder Return Policy reflects the Board’s commitment to increasing the Company’s allocation of capital to stockholders and to enhancing their returns over the long term while demonstrating its confidence in the sustainability of Vishay’s strong cash flow generation and balance sheet.”

Dr. Gerald Paul, President and Chief Executive Officer, said, “Our primary focus will continue to be on investing in growth initiatives including key product line expansions, targeted R&D, and synergistic acquisitions.  The structure of our newly adopted Stockholder Return Policy enables us to allocate capital responsibly among our business, our lenders and our stockholders.”

Over the long-term, Vishay intends to fund the Stockholder Return Policy from the Company’s historically strong cash flows from operations.  The Company may also use its revolving credit facility from time to time, to finance these initiatives on a short-term basis.

Non-GAAP Measure

This Stockholder Return Policy and this press release use “free cash” as a measure. Free cash is a financial measure which is not recognized in accordance with U.S. generally accepted accounting principles ("GAAP") and is considered a "non-GAAP financial measure" under the U.S. Securities and Exchange Commission rules. Non-GAAP measures supplement our GAAP measures of performance or liquidity and should not be viewed as an alternative to GAAP measures of performance or liquidity. Non-GAAP measures such as free cash do not have uniform definitions. These measures, as calculated by Vishay, may not be comparable to similarly titled measures used by other companies.

Vishay defines “free cash” as cash provided by operating activities, less capital expenditures, and plus proceeds from the sale of fixed assets, each as presented in the Company’s consolidated statement of cash flows in accordance with U.S. GAAP.

Although “free cash” is not defined in GAAP, the measure is derived using various line items measured in accordance with GAAP.  Calculations of free cash and reconciliation to comparable GAAP measures are set forth in our filings with the Securities and Exchange Commission, including our annual reports on Form 10-K and our quarterly reports on Form 10-Q.

Forward Looking Statements

Statements contained herein that relate to the Company's future performance, including statements with respect to the Stockholder Return Policy and its objectives, forecasted revenues, operating cash flows, margins, inventories, product demand, anticipated areas of growth, market segment performance, capital expenditures, cash taxes, tax rates, cash repatriation to the United States, and the performance of the economy in general, are forward-looking statements within the safe harbor provisions of Private Securities Litigation Reform Act of 1995. Words such as "believe," "estimate," "will be," "will," "would," "expect," "anticipate," "plan," "project," "intend," "could," "should," or other similar words or expressions often identify forward-looking statements. Such statements are based on current expectations only, and are subject to certain risks, uncertainties and assumptions, many of which are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance, or achievements may vary materially from those anticipated, estimated or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; manufacturing or supply chain interruptions or changes in customer demand because of COVID-19 or otherwise; delays or difficulties in implementing our cost reduction strategies; delays or difficulties in expanding our manufacturing capacities; an inability to attract and retain highly qualified personnel; changes in foreign currency exchange rates; uncertainty related to the effects of changes in foreign currency exchange rates; competition and technological changes in our industries; difficulties in new product development; difficulties in identifying suitable acquisition candidates, consummating a transaction on terms which we consider acceptable, and integration and performance of acquired businesses; changes in U.S. and foreign trade regulations and tariffs, and uncertainty regarding the same; changes in applicable domestic and foreign tax regulations, and uncertainty regarding the same; changes in applicable accounting standards and other factors affecting our operations that are set forth in our filings with the Securities and Exchange Commission, including our annual reports on Form 10-K and our quarterly reports on Form 10-Q. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Implementation of the Stockholder Return Policy is subject to future declarations of dividends by the Board of Directors, market and business conditions, legal requirements, and other factors.  The policy sets forth the Company’s intention, but does not obligate the Company to acquire any shares of common stock or declare any dividends, and the policy may be terminated or suspended at any time at the Company's discretion, in accordance with applicable laws and regulations.  

•	Revenues Q4 of $843 million; year 2021 of $3,240 million.

•	Gross margin Q4 of 27.3%; year 2021 of 27.4%.

•	Operating margin Q4 of 14.4%; year 2021 of 14.4%.

•	EPS Q4 of $0.25; year 2021 of $2.05.

•	Adjusted EPS Q4 of $0.62; year 2021 of $2.32.

•	Free Cash for the year of 2021 of $240 million.

•	Guidance Q1 2022 for revenues of $820 to $860 million and at a gross margin of 27.3% plus/minus 50 basis points at Q4 exchange rates.

Vishay Intertechnology, Inc. (NYSE: VSH), one of the world's largest manufacturers of discrete semiconductors and passive components, today announced its results for the year and fiscal quarter ended December 31, 2021.

Revenues for the year ended December 31, 2021 were $3,240.5 million, compared to $2,501.9 million for the year ended December 31, 2020.  Net earnings attributable to Vishay stockholders for the year ended December 31, 2021 were $298.0 million, or $2.05 per diluted share compared to $122.9 million, or $0.85 per diluted share for the year ended December 31, 2020.

Revenues for the fiscal quarter ended December 31, 2021 were $843.1 million, compared to $813.7 million for the fiscal quarter ended October 2, 2021, and $667.2 million for the fiscal quarter ended December 31, 2020.  Net earnings attributable to Vishay stockholders for the fiscal quarter ended December 31, 2021 were $36.5 million, or $0.25 per diluted share, compared to $96.8 million, or $0.67 per diluted share for the fiscal quarter ended October 2, 2021, and $37.6 million, or $0.26 per diluted share for the fiscal quarter ended December 31, 2020.

As a direct result of a change in tax law in Israel, the Company made the determination during the fourth fiscal quarter of 2021 that substantially all unremitted foreign earnings in Israel are no longer permanently reinvested, and recorded additional tax expense of $53.3 million.

As summarized on the attached reconciliation schedule, all periods presented include items affecting comparability.  Adjusted earnings per diluted share, which exclude these items net of tax and the unusual tax items, were $0.62 and $2.32 for the fiscal quarter and year ended December 31, 2021, respectively, $0.63 for the fiscal quarter ended October 2, 2021, and $0.28 and $0.92 for the fiscal quarter and year ended December 31, 2020, respectively.

Commenting on results for the year 2021, Dr. Gerald Paul, President and Chief Executive Officer stated, “Despite ongoing pandemic related issues and accelerated inflation, the year 2021 was one of Vishay’s most successful years. We continued to expand in critical manufacturing capacities and we defined programs for higher growth in the future. Even with elevated capital expenditures Vishay generated free cash of $240 million in the year.”

Dr. Paul continued, commenting on the results for the fourth quarter 2021, “Revenues came in at the high end of our guidance but margins were negatively impacted by higher than anticipated costs for logistics as well as for materials and services. We expect to continue to raise prices and to return to historical levels of contribution margins in the course of 2022.”

Commenting on the outlook Dr. Paul stated, “For the first quarter 2022, we guide for revenues in the range of $820 to $860 million at a gross margin of 27.3% plus/minus 50 basis points, assuming the same exchange rates versus the dollar as in the fourth quarter.”

About Vishay

Vishay manufactures one of the world’s largest portfolios of discrete semiconductors and passive electronic components that are essential to innovative designs in the automotive, industrial, computing, consumer, telecommunications, military, aerospace, and medical markets. Serving customers worldwide, Vishay is The DNA of tech.™ Vishay Intertechnology, Inc. is a Fortune 1,000 Company listed on the NYSE (VSH). More on Vishay at  www.Vishay.com.

This press release includes certain financial measures which are not recognized in accordance with U.S. generally accepted accounting principles ("GAAP"), including adjusted net earnings; adjusted earnings per share; adjusted gross margin; adjusted operating margin; free cash; earnings before interest, taxes, depreciation and amortization ("EBITDA"); adjusted EBITDA; and adjusted EBITDA margin; which are considered "non-GAAP financial measures" under the U.S. Securities and Exchange Commission rules. These non-GAAP measures supplement our GAAP measures of performance or liquidity and should not be viewed as an alternative to GAAP measures of performance or liquidity. Non-GAAP measures such as adjusted net earnings, adjusted earnings per share, adjusted gross margin, adjusted operating margin, free cash, EBITDA, adjusted EBITDA, and adjusted EBITDA margin do not have uniform definitions. These measures, as calculated by Vishay, may not be comparable to similarly titled measures used by other companies. Management believes that such measures are meaningful to investors because they provide insight with respect to intrinsic operating results of the Company. Although the terms "free cash" and "EBITDA" are not defined in GAAP, the measures are derived using various line items measured in accordance with GAAP. Reconciling items to arrive at adjusted net earnings represent significant charges or credits that are important to understanding the Company's intrinsic operations. Reconciling items to calculate adjusted gross margin, adjusted operating margin and adjusted EBITDA represent those same items used in computing adjusted net earnings, as relevant. Furthermore, the presented calculation of adjusted EBITDA is substantially similar to, but not identical to, a measure used in the calculation of financial ratios required for covenant compliance under Vishay's revolving credit facility. These reconciling items are indicated on the accompanying reconciliation schedules and are more fully described in the Company's financial statements presented in its annual report on Form 10-K and its quarterly reports presented on Forms 10-Q.

Statements contained herein that relate to the Company's future performance, including forecasted revenues, margins, product pricing, product demand, anticipated areas of growth, market segment performance, capital expenditures, and the performance of the economy in general, are forward-looking statements within the safe harbor provisions of Private Securities Litigation Reform Act of 1995. Words such as "believe," "estimate," "will be," "will," "would," "expect," "anticipate," "plan," "project," "intend," "could," "should," or other similar words or expressions often identify forward-looking statements. Such statements are based on current expectations only, and are subject to certain risks, uncertainties and assumptions, many of which are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance, or achievements may vary materially from those anticipated, estimated or projected. Among the factors that could cause actual results to materially differ include: general business and economic conditions; manufacturing or supply chain interruptions or changes in customer demand because of COVID-19 or otherwise; delays or difficulties in implementing our cost reduction strategies; delays or difficulties in expanding our manufacturing capacities; an inability to attract and retain highly qualified personnel; changes in foreign currency exchange rates; uncertainty related to the effects of changes in foreign currency exchange rates; competition and technological changes in our industries; difficulties in new product development; difficulties in identifying suitable acquisition candidates, consummating a transaction on terms which we consider acceptable, and integration and performance of acquired businesses; changes in U.S. and foreign trade regulations and tariffs, and uncertainty regarding the same; changes in applicable domestic and foreign tax regulations, and uncertainty regarding the same; changes in applicable accounting standards and other factors affecting our operations that are set forth in our filings with the Securities and Exchange Commission, including our annual reports on Form 10-K and our quarterly reports on Form 10-Q. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets (continued)
(In thousands)
		December 31, 2021				December 31, 2020
		(Unaudited)
Liabilities and equity
Current liabilities:
Trade accounts payable		$	254,049			$	196,203
Payroll and related expenses			162,694				141,034
Lease liabilities			23,392				22,074
Other accrued expenses			218,089				182,642
Income taxes			35,443				20,470
Total current liabilities			693,667				562,423
Long-term debt less current portion			455,666				394,886
U.S. transition tax payable			110,681				125,438
Deferred income taxes			69,003				1,852
Long-term lease liabilities			99,987				86,220
Other liabilities			95,861				104,356
Accrued pension and other postretirement costs			271,672				300,113
Total liabilities			1,796,537				1,575,288
Redeemable convertible debentures			-				170
Equity:
Vishay stockholders' equity
Common stock			13,271				13,256
Class B convertible common stock			1,210				1,210
Capital in excess of par value			1,347,830				1,409,200
Retained earnings			401,694				138,990
Accumulated other comprehensive income (loss)			(20,252	)			13,559
Total Vishay stockholders' equity			1,743,753				1,576,215
Noncontrolling interests			2,967				2,800
Total equity			1,746,720				1,579,015
Total liabilities, temporary equity, and equity		$	3,543,257			$	3,154,473

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of Adjusted Earnings Per Share
(Unaudited - In thousands, except per share amounts)
		Fiscal quarters ended												Years ended
		December 31, 2021				October 2, 2021				December 31, 2020				December 31, 2021				December 31, 2020
GAAP net earnings attributable to Vishay stockholders		$	36,523			$	96,820			$	37,567			$	297,970			$	122,923
Reconciling items affecting gross profit:
Impact of the COVID-19 pandemic		$	-			$	-			$	268			$	-			$	4,563
Other reconciling items affecting operating income:
Restructuring and severance costs		$	-			$	-			$	-			$	-			$	743
Impact of the COVID-19 pandemic			-				-				(580	)			-				(1,451	)
Reconciling items affecting other income (expense):
Loss on early extinguishment of debt		$	-			$	-			$	553			$	-			$	8,073
Reconciling items affecting tax expense (benefit):
Changes in tax laws and regulations		$	53,316			$	-			$	-			$	45,040			$	-
Change in deferred taxes due to early extinguishment of debt			-				-				(217	)			-				(1,563	)
Effects of cash repatriation program			-				-				-				-				(190	)
Effects of changes in valuation allowances			-				(5,714	)			-				(5,714	)			-
Effects of changes in uncertain tax positions			-				-				3,751				-				3,751
Tax effects of pre-tax items above			-				-				(12	)			-				(2,799	)
Adjusted net earnings		$	89,839			$	91,106			$	41,330			$	337,296			$	134,050
Adjusted weighted average diluted shares outstanding			145,617				145,458				145,251				145,495				145,228
Adjusted earnings per diluted share		$	0.62			$	0.63			$	0.28			$	2.32			$	0.92

VISHAY INTERTECHNOLOGY, INC.
Reconciliation of Free Cash
(Unaudited - In thousands)
		Fiscal quarters ended												Years ended
		December 31, 2021				October 2, 2021				December 31, 2020				December 31, 2021				December 31, 2020
Net cash provided by operating activities		$	146,652			$	135,669			$	125,699			$	457,104			$	314,938
Proceeds from sale of property and equipment			60				1,023				110				1,317				403
Less: Capital expenditures			(100,216	)			(57,446	)			(52,798	)			(218,372	)			(123,599	)
Free cash		$	46,496			$	79,246			$	73,011			$	240,049			$	191,742